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Inventory Management Software in the Food Industry

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For your restaurant to be successful, you will need to have the key ingredients: a great chef, a vision, and the necessary inventory management software and procedures. Without effective management of your inventory, your restaurant might suffer. Even if you have an impressive menu and a nice location, your restaurant might not be as sustainable and profitable as you want it to be.

A restaurant inventory management software is a necessary monitoring tool that will help you track each meal, supply order, and ingredient that goes in and out of your kitchen. Proper inventory management in the kitchen improves the efficiency of your employees and reduces inventory loss. This only means that the amount of food waste or spoilage is reduced.

Why does the food industry need an inventory management software?

Inventory management involves tracking all the stocks, planning the menu according to the available inventory, and standardizing recipes. It calculates the usage and the depletion – the number of days the current inventory will last and the number of items that are used in a day or a week.

Inventory management helps you predict the restaurant ingredient needs to prevent under or overstocking. In short, it allows you to accurately track both your inventory and profit margins. It also notifies you whenever there are any shortages or surpluses before it’s too late.

Poor inventory management causes some restaurants in the country to lose 10% to 15% of their inventory. You can prevent incurring any losses if you have an inventory management software set up. With the help of such software, the automation of inventory management is simplified. And since it makes the process simple, it reduces errors and engages more staff to minimize any food waste.

What can an inventory management software do?

The key to running a successful restaurant is to take accurate inventory. You should take stock counts at the start and at the end of the day. Make sure to indicate all the ingredients that are ordered throughout the day. Also, indicate the food that’s left on the shelf.

Food industry inventory management software

With the help of an inventory software, managing stocks, minimizing food waste, and maximizing efficiency will be a lot easier to do. You’ll be able to calculate the operational costs that you spent on food (food cost percentage) so you don’t overspend on unnecessary ingredients. This information is very important in inventory budget planning, so make sure to track it.

Calculate the food cost percentage by recording the value of the inventory you received at the beginning of the week. Do this throughout the week. Next, subtract your ending inventory from your total purchased inventory. Lastly, for the same week, divide it by your total food sales. The food cost percentage is simply the difference between the revenue your inventory brought in after they’re sold to the consumers and the costs you have spent on the inventory.

There is a difference between the food cost percentage for fine dining restaurants and regular restaurants. It should be about 35% for fine dining restaurants, while 25% for regular restaurants. You can easily calculate the cost percentages and track your revenue by using inventory management software like focalsoft to monitor inventory usage. If your food cost percentage is higher than expected, then you should look for other options to reduce waste, manage staff error, and prevent surpluses.

What features should an inventory management software for restaurants have?

There are so many inventory management systems out there, and each software has different capabilities and features. When choosing a restaurant inventory software, you need to take your time to understand what your business needs. You don’t choose based solely on the price – just because the software is expensive doesn’t mean it’s the best for your business.

Below are the features you should be looking for in a restaurant inventory management system:

Automatic inventory updates

A reliable inventory management system should offer automatic inventory updates whenever it’s linked to the POS system. As soon as you link the recipes and ingredients to the menu items, the inventory software should give you real-time updates regarding the inventory depletion and predict the inventory needs accurately.

Being able to communicate with vendors

An inventory management software for restaurants should let you store all vendor information in one place. With this feature, you can facilitate the supply orders as well as the delivery notifications. Whenever your stock is running low, the software should send notifications. It should also send notifications when you track payments and suggest purchase orders. Lastly, whenever a shipment arrives, it should be able to automatically adjust the inventory.

Communication between the warehouse and all locations

When looking for an inventory management software for restaurants, make sure that it integrates the warehouse and all the locations for seamless communication. The software should allow you to easily track deliveries at the warehouse. It should also let you coordinate the inventory at all locations. Whenever new orders are placed, it should send you a notification, so you can keep the warehouse stocked. This ensures that there’ll be no shortages.

Creating accurate and up-to-date reports

Your inventory software should allow you to calculate food cost percentages and create accurate financial reports. If you want to get a clearer picture of your business, you need to access financial reports. This includes current stock levels, sales, and inventory losses. You shouldn’t have to manually collect data.

Facilitating transfers between locations

A reliable software should make it easy for you to run multiple locations all at once. Instead of having to buy more inventory at one location, you should be able to transfer a surplus using the software. This helps reduce any food waste and unnecessary purchases.


If you need to buy an inventory management software for your restaurant, make sure that it has all the features mentioned above. After all, your software should take the stress out of managing your inventory. Choose one that can reduce common resources of shrinkage, simply by keeping track of the products, as they come and leave your kitchen.

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